Often Partisan

Paladini Bid – What Happens Next?

News broke this morning that a consortium fronted by Solihull-based Italian Gianni Paladini has made a formal bid believed to be in the region of £30million to purchase Birmingham City Football Club from Birmingham International Holdings.

The bid, which is understood to be made up of an initial payment of £17million with instalments to follow has been formally made to the board of BIH.

At the time of writing, the deadline for announcements to be made to the HKSE has passed for the day – and thus for the weekend. This means it will be at least a couple of days before there is a formal response from BIH in the form of an announcement to the HKSE – and this is of course IF BIH choose to respond quickly.

The BIH board have to decide how they wish to proceed. If they think the bid isn’t good enough, they are within their rights to reject it out of hand – as they have a previous bid. However, if they think the bid is worth looking into then two things can happen.

Firstly, it is my understanding that whilst the Paladini consortium has done it’s due dilligence over the historical data they will want to look at the up-to-date financial data on Birmingham City including future income forecasts etc. Of course, as this information is confidential BIH will not want to allow Paladini’s consortium to look at the books unless they are satisfied that the bid is a serious one; and Paladini’s consortium won’t want to be gazumped by another bidder whilst they are doing full and proper checks. Therefore it’s my understanding that the next phase would be an announcement that BIH have entered a period of exclusivity with Paladini’s consortium. This would require an announcement to the stock exchange prior to it’s start.

Secondly, once both parties are happy that the bid is fair and that they want to proceed then the BIH board will be obligated to seek shareholder approval from the shareholders of Birmingham International Holdings to ratify the sale of BCFC. This would require a total of 51% or more of the shares owned by shareholders voting in agreement with the board. Carson Yeung currently owns around 25% of the company and thus would have to seek at least another 26% to back him.

Approval would be gained via an Extraordinary General Meeting (EGM) of shareholders, again which would require announcement to the stock exchange. To give an idea on timescales, I saw a similar type of EGM announced by a different company to the Stock Exchange yesterday that is to take place on 20 November so it would be approximately 3 weeks from announcement to EGM.

If approval was gained, I understand that it would take a further 2 to 3 weeks to fully push through and thus it is my belief that for a takeover to be fully concluded by the January transfer window Mr Pannu must accept now.

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57 Responses to “Paladini Bid – What Happens Next?”

  • the badger says:

    17 mil up front, then sell Butland for 10 mill+, Redmond for4 mill+. Leaving an initial outlay of less than 3 mill. Nice work if you can get it Mr Paladini.

  • the badger says:

    PS
    And trouser some commision!

  • Alex T says:

    But he does have a brain…. These 2 will be worth double that in a couple of years time, combine that with the assumption that we wouldn’t be selling them whilst in the financial mire and hence would improve a bargaining stance and Paladini and his chums would earn a great deal more on his investment.

    Thats my glass half full view anyway…..

  • DoctorD says:

    To repeat my previous amusing analogy, we could well be going from the frying pan (wok?) if not into the fire, then certainly into the heavy-duty casserole dish that will see us slow-roasted at 250C. We’ll be shot of one board and its problems, to be replaced by another set of difficulties. Don’t expect things to be easy. One thing is for sure — at least he’s not under arrest, can speak English, and we know where he lives.

    • jonny says:

      im with you doctord im not totally convinced on paladini and havnt been since he first showed interest i would like to know whos in his consortium but i doubt we will untill the takeover goes thru i just hope it isnt out of fire and into pizza oven but as you say at least we know where he lives !!

  • Mark Y says:

    Almajir. Do you think that the fact that there are no auditors in place who have sufficient knowledge of the situation, that the “due diligence” process will be hampered or even impossible to carry out until such time as replacements auditors are in place who are fully aware of the situation.

  • KeepRightcroydOn says:

    I note with interest the variance in reaction to Paladini from comments on this site compared to those on the Birmingham Mail site. Here most of us are sceptical, but on BM the general view is welcoming, mainly because he lives locally. Mostly they seem unconcerned about his past.Are we better informed?

    • almajir says:

      I’m currently preparing a profile piece on Paladini I’ve pencilled in for Sunday

    • Agent McLeish says:

      Paladini is irrelevant, he is just a front man or agent for the real power behind the bid, Briatore IMO.

      • almajir says:

        There have been repeated denials that Briatore is involved. To be honest, I don’t think he would be. However, you are right… Paladini isn’t the money man

  • Oldbluenose says:

    As in Doctor,D’s piece earlier.!!. It is still my biggest fear that we may be swopping one set of problems for yet another with Paladini, ?.

    As a long standing Blues supporter, I do not wish for yet another ” group ” of virtually unknowns, taking over our club, I could forsee yet more problems ahead for us, — Unless, there is complete transparancy with any future owners, !!.

    Banging on my little drum again,!!. Sully/Gold and Brady, is the template I would prefer, !!.

    • Paul Carter - The Voice Of Reason says:

      What people who don’t put a penny into the club then tell us how lucky we are to have them then flog us to the first chancer that comes along?

      • Oldbluenose says:

        Paul;, The analogy was that they built the club again from bottom up, and they kept us solvent,!!.

        I also thought that Sully, was far to mouthy at times, but he did not deserve the disgusting display by ” fans ” whilst his two children were petrified with him in the directors box,!!.

        No wonder that he ended up not giving a toss about us, !!.

        The point of this reply is that I want the same type of people in, as they were in the early years, !!.

  • AR says:

    One of the worrying things about a Paladini consortium is the trigger-happy past with regard to the hiring & firing of managers. I have read that Holloway was sacked by them, which doesn’t bode well for their ability to choose a manager. No club does well without a period of continuity, and I know that we are in a mess financially but PP hasn’t done badly by his managers. I suppose if this sale were to go through, we wouldn’t be worrying about a 10 point reduction in the short term. I suppose I am a glass half-empty sort of person.

  • Oldbluenose says:

    Almajir;, I forot to add, that I, as well as the others are waiting eagerly for Sunday, ?.

  • Blueboy88 says:

    Almajir , BDO have stood down, saying they had not been able to get “consistent, reliable and complete” information from BIH.

    Do you think that is a decision made because BDO were not willing to make any official declarations with reference to due diligence , from any interested parties looking to purchase BCFC ?

    If BDO can not get “consistent, reliable and complete” information from BIH.
    How can any consortium looking to purchase the club ?

    Should they succeeded how reliable would any financial information currently be from BIH
    with no accounts . & no auditors ?

    • DoctorD says:

      If BDO can not get “consistent, reliable and complete” information from BIH.
      How can any consortium looking to purchase the club ?

      Yeah spot on Blueboy88. My worry is if any new purchasers are similarly gung-ho and unreliable about their accounts and cash. I mean, it’s usually only dodgy people buy dogdy second-hand cars, right?

  • IOB says:

    Correct me if I am wrong but do prospective buyers who wish to do due dilligence have to pay something like £60,000 to actually get to see the full accounts ? so if that is the case, BIH have to show everything by law.

  • KiwiJohn says:

    What people seem to not see is that there are not loads of respectable, top notch businessmen queing up to buy Blues. The “out of the frying pan…” comment is a bit simplistic. It would be great to choose our next owners, but that simply isn’t going to happen. Money talks. I think we are extremely lucky to have even a glimpse of a take over by january. Paladini is a front man, we all know that, but unusally in football these days he does have a conection with our beloved club. His background is not perfect – but experienced. We perhaps need to give him and the consortium chance at least. It can’t be worse – can it?! KRO

    • Sirharry1875 says:

      I agree totally Kiwi. To many people on here still think that a respectable Branson type character is going to come to the rescue and heavily fund a promotion push. A reality check is needed. It’s never going to happen. Paladini is all we’ve got. Where’s the other potential buyers? If they want to buy us then they need to start making noises and I’m not hearing anything. If you want to buy a house and somebody else puts in an offer then you go in higher, quickly before a deal is done.

  • Jay Sidney says:

    KiwiJohn asks the question that a Paladini-led consortium can’t be worse than the current mob in charge. Well, if it is true that this consortium wants to pay for BCFC via instalments, is it not already clear that Paladini and his mates might not even have the same amount of capital that Carson Yeung had when he took over at Blues in 2009?

    All the signs with Paladini are wrong.

  • Retired&Weary says:

    Well said KiwiJohn! All this picking & choosing by people who don’t really know anything about any of the runners & riders is frankly frustrating. At the moment the most likely alternative is no owner & no club. If the Italian Consortium manages to buy the club you never know there could be interesting times ahead, as opposed to the current apathy surrounding the club.
    To upset the know alls even more we could even get ‘Arry Redknapp. Of course we wouldn’t like that shady Cockney wide boy who took a team from the bottom of the league to top 4 playing attractive attacking football!

  • Steve-0 says:

    I think we should take our chances in the fire, this frying pan is cheesing me off.

  • andy says:

    I dont think we are in any position to question who buys the club. The current situation at the club is a complete mess and it wouldnt bother me in the slightest who comes in so long as they plan to take us forward and give Lee Clark the opportunity to build his own squad and put Butland and Redmond on decent long term contracts to stave off the vultures.

  • Benjani says:

    Logically if we dont sell the club we will go into admin at some stage down the line…..as the funds will dry up..

    Im happy for this guy to buy us, yes he hasnt got the best of reps but he understands football and he can get us out of the finanical mess we are in.

  • Bluebird says:

    (2) Points –
    Concern has been shown regarding payments from Paladini in instalments –
    I consider that to be extremely prudent –
    If the auditors have resigned due to the lack of full disclosure & co-operation then the instalments provide some security against being conned –
    Once they complete the take-over they can completely assess the situation prior to the payment of the next instalment which I presume will be conditional.
    My other point is regarding comments on the BEM which from my perspective appears to censor anything of which they do not approve –
    I have attempted to leave comments on there in recent weeks and I do not consider myself to be the most volatile or radical of contributors –
    But when I hit the ‘Submit’ button the ‘rotating wheel’ appears and the post is never published –
    That has only ever happened with the BEM –
    I never have that problem with this Site!

  • Paulo says:

    If a bid isnt accepted this coming week, we stand every chance really of becoming financially stuck in January and having to find ways of sustaining the club. I can’t see how any funding can now be found and the priority has to be focused on the club ..and not the pockets of those looking for a ‘return’.
    Even of Paladini is the frontman of Briatore’s supposed consortium, it is investment we need and could be our only saving grace right now. Who the hell knows what is going on behind the scenes anyway, but my guess is that CY wants a HK connection to succeed him, but we all know how long anyone in HK is prepared to drag their feet in business ..such as this.
    Do any of us have a choice? I doubt it. But we do have the choice to vote with our feet if it all goes a bit south.

    • blueboy88 says:

      Paladini’s consortium is the only game in town & we are desperate.

      The Football League is expecting BCFC accounts for the season 2011/12 to be submitted in less than a month on 1st December 2012.

      With no auditors , what chance ?

      Are we then looking at another transfer embargo ?

      Regardless of some reservations about the Paladini consortium , I agree BCFC need investment
      & if Paladini brings that we should welcome his intervention…

      • almajir says:

        Incorrect. Accounts have to be submitted by March 1. Furthermore, BCFC are not BIH … They have managed to submit accounts albeit with a disclaimer of opinion without BIH accounts being submitted.

        • Blueboy88 says:

          I will bow to your superior knowledge ,.as I am now confused , can you explain..

          The BCFC accounts submitted in June were for the season 2010-11 .

          The Football league financial fair play rules of which Swindon have recently fallen foul of
          State that the first reporting period will be the season 2011/12 – with the first set of accounts due to be submitted on 1st December 2012.

          Is that not the case then ?

  • james says:

    We are between a rock and hard place. Don’t sell – admin, lose more talent and another season, or 2, in the championship. We sell, to what’s looking more and more likely to Paladini and it’s a very rocky ride. I don’t like the man, he has the persona of a second car dealer. I would have more confidence in the consortium if we knew how they were and how much they are worth.

    All the fans can do in the meantime is support the team and get behind LC – the result last week was fantastic, although walking back into town from the ground was a tad daunting…!

    KRO

  • Retired&Weary says:

    Almajir, don’t worry I’m sure ‘Arry will end up at QPR or the like soon. I am intrigued, however, as to why the mention of his name causes you to stamp your feet so much. Is it because he’s the darling of the London sports media, or you feel, like many, he “got away” with it re his tax issue? Please illuminate us a little.

    • almajir says:

      In my opinion he’s as bent as a three quid note

    • Well Almajir can speak for himself but my answer to that would be both. He should have gone to prison and the only reason he didn’t was that he gave the whole cockney geezer “who me, guv” routine the works and won the sympathy of the (cockney) jury.

      I wouldn’t be too worried about Redknapp taking over at Blues though. Look at the teams he’s managed: Bournemouth, West Ham, Tottenham, Portsmouth, Southampton. There’s a bit of a geographical pattern there I’m sure you’ll agree……… He has gone on record numerous times saying he prefers living down there.

      He’s a geezer, and wants to live with the geezers.

  • DoctorD says:

    WIth that frying pan analogy I made, I wasn’t in the slightest thinking how nice it would be to pick and choose our prospective owners. All I am saying is that a change of ownership is unlikely to be a panacea.

    As I mentioned, one set of problems will disappear (the owner under arrest, dodgy accounts, shady characters, the shirt deal etc) with a different, but fresh set of likely “issues”. (If it is Paladini, I am guessing a hire-and-fire mentality, faintly ludicrous over-ambition that comes back to haunt us, trying to impose some silly entrepreneurial stamp all over the club much to the annoyance of BCFC staff — you can see it happening can’t you?).

  • almajir says:

    I look forwards to reading it, always good to see new sites spring up

  • Aussiebrum says:

    With a takeover the directors of BCFC have special obligations.

    In particular there are sanctions applicable where a director might have a conflict of interest – especially if a director might benefit from the takeover either proceeding or not proceeding.

    To comply with their duty a decision to sell or not sell a company must be made by an independent board.

    This means a director can neither appear on both sides of a transaction nor derive a benefit from the sale.

    So those BCFC directors who are also a director of the selling entity, BIHL, need to disqualify themselves from voting on the transaction – only there are no independent directors so this would lead to a paralysis of management.

    And if the rumors are true that Peter Panu generates a significant bonus for orchestrating a sale – Panu too will have to disqualify himself from voting or active management of the bid/s.

    And everyone needs to remember that BIHL are not the sole owners of BCFC so a reasonable question which directors are looking after either the real interests of the non aligned shareholders or indeed the subsidiary itself.

    Then again, corporate governance doesn’t seem to have been a priority for these guys at any time.

  • theurbaneguerilla says:

    Haha. Alwaysblue 78. Looking forward to “pepole” with special Blues knowledge. Let’s hope they’re not “special pepole” like you, you clown.

    • almajir says:

      Just to let people know, I’ve deleted a further comment from Alwaysblue78.

      Whilst I accept that people have the right to criticise I believe I have the right to delete outright abuse against me, especially when it’s untrue and unfair.

      I appreciate that this might seem a bit out of line but I believe I’ve been fair in even confirming that I’ve done that.

      • Blueboy88 says:

        Almajir , If you give an opinion , you have also got to take one.
        In threads above you describe Harry Redknapp thus ” In my opinion he’s as bent as a three quid note” would that not be seen by the Redknapp family as outright abuse , untrue and unfair ?.

        One man’s Opinion is another man’s Abuse ?

        Regular contributors to OP would have had the measure of these critical posts from the off , & in that you must trust , not censorship . Additionally you do have the right of reply , which is as it should be with freedom of speech.

        I have always enjoyed your OP blogs & the discussion they then generate.
        I do not always agree with all of your opinions , or those of other contributors ,
        But isn’t that the point , a frank exchange of views ?

        It must be massively hard work keeping the site going , you are doing a great job ,
        so get your head up , in the full knowledge the vast majority are on-side,

        You will go to bed tonight with a couple of boo boys in the background ,
        How quickly would Lee Clark would swop places with you , he has got 20k+ :-)

        You are plainly passionate about OP & everything BCFC , if cut you would bleed Royal Blue & White , . which will do for me…

        KRO

  • crotcher88 says:

    let them knock your hard work almajir take no notice of sados keep up the good work at least you try

  • Tom says:

    I think your comment on Harry Redknapp being our manager is pathetic your telling me a man who should of been England manager wouldnt be welcomed at St Andrews im sick of all this complaining, who would the fans want as manager before there happy Mourinho or Pep


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